Bertelsmann is Europe's biggest media company, with significant interests in all areas of media including television, film and radio and book, magazine and newspaper publishing. Subsidiary businesses include broadcaster RTL, magazine publisher Gruner & Jahr and the world's largest book publisher Penguin Random House, a joint venture with Pearson, now 75% owned by Bertelsmann. The group's original recorded music group BMG was sold to Sony in 2008 but Bertelsmann retained a small but significant music publishing business under the same name, and has begun to move back into recorded music to exploit the explosion in digital distribution. Its Arvato division is a powerhouse behind the scenes in services such as book and periodical printing, CD manufacturing, direct mail and IT services. For several years in the early 2000s, Bertelsmann had been gradually restructuring itself in anticipation of an IPO. That process was painful to say the least, leading to the ousting of several senior executives. In the end however, Bertelsmann took the decision to remain private, buying back the shares it didn't already hold. As a result it is entirely owned and controlled by Germany's Mohn family. Revenues for 2017 were €17.2bn. Thomas Rabe is CEO. Adbrands no longer offers a business profile for this company but subscribers may access account assignments and contact information. The searchable account assignments database is available to full subscribers to Adbrands.net premium services. Click here to access Adbrands account assignments (subscribers only); or see here for information on how to subscribe.
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Capsule checked 13th April 2018
Adbrands Weekly Update 29th Mar 2018: Bertelsmann reported its best performance for more than a decade, with revenues edging up by 1% to €17.2bn, and net profit by 0.5% to just under €1.2bn. TV and radio broadcaster RTL continues to dominate the group, with revenues rising to €6.4bn. That division alone accounted for more than half of group operating income. There was an increase in revenues for Arvato, the group's #2 division, to €3.8bn, while #3 Random House Penguin was down very slightly to €3.4bn. Both suffered a slight decline in profitability.
Adbrands Weekly Update 13th Jul 2017: Bertelsmann is to acquire an additional 22% of equity in the Random House Penguin joint venture with Pearson, lifting its total holding to 75%. The deal values the business at $3.55bn. The move was largely expected, giving Bertelsmann greater control of the world's biggest book publisher. Pearson has been gradually withdrawing from other businesses to focus on educational publishing. It will retain the remaining 25% for at least another 18 months, at which point Bertelsmann has an option to take full control.
Adbrands Weekly Update 30th Mar 2017: German media giant Bertelsmann reported its best profit since 2006, with net earnings up almost 3% to €1.14bn. That was despite a 1% decline in revenues to €16.95bn as a result of exchange rates. The key contributor was broadcast division RTL, which reported steady growth in revenues to a new high of €6.24bn and operating profit of €1.41bn. Marketing and logistics business Arvato also performed well, along with small but fast-growing music rights unit BMG. There were declines at Penguin Random House, despite the massive global success of Paula Hawkins' The Girl On The Train, and the Gruner & Jahr magazine division and printing group were also weak.
Adbrands Weekly Update 18th Jan 2017: Bertelsmann looks set to take full control of book publishing giant Random House Penguin, after partner Pearson triggered an option to exit the business. That decision follows an "unprecedented" decline in Pearson's core North American educational publishing business, where sales dived by 30% in the final quarter. Formed in 2013 by the merger of Bertelsmann's Random House and Pearson-owned Penguin, the business is currently a joint venture, 53%-controlled by Bertelsmann. The German company said it is "open" to buying out Pearson's 47% stake "provided the financial terms are fair".
Adbrands Weekly Update 24th Mar 2016: Net profits for 2015 at European media giant Bertelsmann almost doubled to €1.1bn. That was partly a result of a reduction in special items - the previous year included a big impairment against broadcast operations in Hungary - but also strong growth at the two main divisions of RTL and Random House Penguin. The latter reported a 23% jump in profits from the success of the latest Fifty Shades installment (which sold 8.5m copies) and Paula Hawkins' The Girl on the Train (7m copies). That offset continuing declines at magazine division Gruner & Jahr. Group revenues grew by 3% to €17.1bn, their highest level for almost a decade.
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